YouSaid · the spoken record

Ethan Harris

lines on the record: 105
first: 2016-02-05
most recent: 2016-02-05
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“And maybe the lesson is that I did learn was admitting errors is fine. Sticking to wrong views in the face of the evidence, that is wrong. But admitting errors, people respect that, especially if you're open and honest about it. You don't need to be right all the time. We all know that it's an art more than a science, and we get a lot of bad forecasts. So it's knowing when to capitulate is another kind of key life lesson there.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so it's that finding that it's finding the right angle on things that to me was the thing that makes you a good economist. And the other thing is knowing when to capitulate. Oh, I didn't get the right angle.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that what you learn is about Learning to kind of work in very high levels of uncertainty about exactly what You're looking at and knowing. It's okay to be kind of lost for periods of time and to figure it out. I've always felt that what happens in the economy is that you get an event, you figure out the right angle, and if you get it right, if you figure out what's really the issue and how it's going to play out, your forecast just follows and you become smart for a year”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“All right, I'm going to go to law school and it buys me three more years to figure it out. Right. And so I think that there's a lot of people had a big learning process. And a lot of kids come out of college. They're not sure what they do. A lot of people don't.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I did it No, and I'm pretty lucky too, because I think that the share, I mean When I arrived at college, you had about 300 premed maj maj maj majors and 200 pre-law majors. And of course, by the end of college, there were a lot fewer pre-med and pre-law people, because that was the easy path. Free law was what you did when you.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think it's a better route. I think it's more flexible. But I think that there's a lot of things you can do with an economics degree. I've always wanted to just be an economist. And so to me, that was never an option. I majored in economics when I got to college. I went straight to my PhD program. I went straight into working at the Fed. There was never any kind of I mean, I'm a pretty boring person, let's face it. I wouldn't say that, but.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and kind of just a cost conscious world that we live in. And so it's a tough road. And I think one thing I would say to people who've had economics training is that there are a lot of things you can do with it. You don't have to become what I am, which is an economist working in an economics team. You could be a strategist. You can be a portfolio manager. There are many things you can do. The great thing about economics is it's a discipline of the way you think about the world that makes it applicable to many things. When I tell people, I often have... Kids send me emails asking advice about who are coming out of college and stuff. I always give them that advice. If you are absolutely in love with economics, Go get a PhD, suffer through that. If you're not absolutely in love with it though,”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, all that stuff has turned it into a very heavily regulated business. And the good news is that it's working and you don't get that kind of behavior. The bad news is that it's The level of paperwork and that you have to go through is tremendous. And so from a day-to-day point of view, that's been a big change. I don't think that the business of being an economist has changed. It's always been, to my mind, what I do is always about new questions come up and just being flexible about the way you address them and being ready to find new angles. It's not that I had a particular model that I used for years. It's not working. I've had to change my models. What's happened is you always have to change your model because the models are never adequate. There's always something”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I would say that the big changes has been the regulation of financial markets. And so it's been, remember, in reaction to a lot of scandals in the business. Back in 2000,”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I'm really terrible at remembering authors. So, Atkinson's trilogy book on World War II, US in Europe. Army at Dawn. Quite a powerful story. It tells you a lot about how what a mess it was when the US entered Europe and you had a bunch of amateur generals basically trying to fight the Germans.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Right, I think that was what he wrote his version of events, which is interesting to kind of see the way the Anderson kind of evaluates that. So I love history. I've been reading since I was a kid”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Because he came in there in the middle of this, it's a tribal place. And some of the things that the imperial powers did there were quite bad, so...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“A couple years. No, no, this is the reason who's the author. Actually, I can't remember off the top of my head. Lawrence in Arabia, not Lawrence of Arabia. And the reason he calls it Lawrence in Arabia is because He was an outsider coming into And the book is fascinating because it gives you this sense of the underlying history of the Middle East. And you start to understand why the region is such a mess.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And what do you write about and what the questions you address, they have to be dictated by what the market cares about at the moment. They can't be... This is an interesting topic, and I'd like to write about it. It has to be all driven by what I want to do is say that clients have a wrong idea about X. They're all obsessed about it. That's wrong. I'm going to explain why. That's what I want to write about.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Because there's always some angle that you didn't get. And so it's not so much, it's that part. It's kind of combining the strategy. Because one of the things that I think very important to clients is they don't want economists where there's this kind of strict boundary line where you make your Fed call, your inflation call, and your growth call, but you never make the next step into what does it mean? What does this mean for stocks and bonds? Right. So you need to be able to do that. And so there needs to actually be some overlap between what the economist is doing and what the strategists are doing. Otherwise, the client's not getting.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean I'm not really a guy who gets information from investors. I mean, what I have done over the years is that I find that it turns out in this job that being a macroeconomist is only part of it. You have to understand financial markets and how they work. And so over the years, kind of working really closely with people who cover credit. The equity analyst. Even today, you know, we, in my own work now, we collaborate all the time with the analysts and the other parts of research.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's one of the hardest things to teach. It's really hard to teach because, I mean, and there's no way around it except to get, it's kind of like language immersion. You can't learn a foreign language unless you immerse yourself. Taking it once a week doesn't work.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“So practical hands on every day somebody gets their paper ripped apart in class right down to the gory details. And you know, it's kind of like, you know, you either survive. What doesn't kill you makes you stronger kind of world. I came out of that knowing how to write. I think. Is a very important part of what we do.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so he decides to teach a writing class. And I took the writing class, and that class, I'd say, I've never had a class that made such a big difference in my ability to do, I learned to write. It was a practical.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, he ended up getting an MBA and being in the hospital financia business, but he didn't continue in economics. My thesis advisor was a guy named Phil Kagan, who coincidentally is also a Chicago guy. And the thing I like with Kagan is that he was at a time where a lot of professors didn't seem to kind of want to put out for their graduate student. He was there at Columbia kind of a guy who was quite willing to work with you. He was also somebody who kind of had a very sober Unbiased way of looking at issues and things. And so he was quite an inspiration. But the guy who really was, what I find the most interesting is the guy who I think was best for my career was a history professor I had in college. This history, he's a Russian history professor, and he hated the writing he was getting out of his students.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“They did, and you look at all the Nobel Prizes that came out there. That was a great department. What did he end up doing?”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“He really embraced and loved economics. He was inspired by some of the best professors ever, you know, people like Milton Friedman were there and stuff. That was a...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I mean, the people who kind of influence me, I pick three names. I read your questions ahead of time, so I've had to think through it. I think my oldest brother, because he's the guy from University of Chicago in Chicago. He's...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so Paul says to me, well, they can't let Lehman go under the financial markets would collapse. And I said, but Paul, we may not be in our office on Monday. And sure enough, I mean, it was... You could feel how dangerous it was in real time. It was not at all a surprise when over the weekend, if they didn't have a deal, They were done. Yeah, that's.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the answer was Lehman. Yeah, and so if you were tuned into it, you knew that every end of quarter earnings announcement was dangerous for all the investment banks. And it was a domino thing. It was like all of the investment banks had big problems. But, you know, it was kind of like, where was the market focus at the time? And so Lehman was in the crosshairs. And so you could feel it. The weekend before Lehman went under. I was sitting down with my boss at the time. I was the chief U.S. economist, and he was the global chief's named Paul Sheard. Paulson had just announced that there would be no government money for Hank Paulson. Yeah, yeah, for Lehman.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that, I mean, the lead up to the crisis, it was pretty obvious, I think, to people in the business that there was a domino effect going on.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“To say the least. I'd say there are two things that stood out about one he was a tough dude, and the other was he lived and breathed Lehman Brothers. He was in love with his company. This was his baby. And so all the things you can say about him, it certainly...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And so the idea of cutting a deal where you sell assets at a huge discount probably was too much for him to stomach. But in hindsight, it was a massive mistake.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Everything was much, much rougher. I mean, I wonder whether, you know, he just didn't want, you know, is this kind of like a parent who doesn't want to admit their kids not getting into Harvard? The firm had big problems, as you said, because of not just the residential but commercial real estate.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“We were out in the soup, and you could argue that I'm sure there are mistakes made that could have avoided some of the pain. Well, the big one was...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And then being in the front row watching Lehman go under, right? So Lehman had been an investment bank, had problems over the years. And Fold took over. It was a company that was a work in progress, kind of reviving itself. And he did a tremendous job of getting the firm back There were some early scares around the long term capital period where funding markets were really at a very tight markets for a while there. But he kind of built, this was his company that he built. And so, you know, the bank went from being, I would say, kind of a second tier to right up there just below the Goldman Sachs of the world. And so that was a tremendous accomplishment. And then, of course, I think that Lehman fell victim to something that all the investment banks were victim to. We just happened to be kind of at the wrong place at the wrong time.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“You had to have Had to be absolutely terrifying. Well, I mean, so I've had the fortune and misfortune of being in front row for a number of wonderful things, pretty awful things. What else?”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm primarily focused on the investment bank at B of A Merrill Lynch. The new part, which in some ways is fun, is the retail business, right? So you do need to be able to go and give a dinner speech to high net worth individuals, you know, the big clients of our wealth management business. You need to know how to dejarganize and kind of have two different speeches you're giving, a friendly one and a more technical one. So that ability to kind of switch gears, I think, is the one kind of new challenge of moving to a place where you have a big retail business.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think that the, I don't think it's a huge difference. Remember, when I worked at Lehman Brothers, I was working in the, obviously it's an investment bank, and a lot of my time spent dealing with the trading floors and with all digital traders and clients and institutional customers.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Willing to change gears like that. Something comes up. Writing something, and suddenly it's interesting, but it's not really what everyone's focused on. Throw that out and start over again because this is the question of the day. And people want that need fast answers. And that kind of ability to kind of, first of all, cover multiple topics and many different kinds of clients and switch gears quickly is extremely important.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I mean, one of the things you discover immediately is that everything moves at 100 miles an hour if you work on the street. At the Fed, I would do briefings before the FOMC meeting. So I would brief our local president in New York before he go down to Washington to vote on monetary policy. I'd have a three or four weeks to get my presentation together. That would be in full time, right? On Wall Street, you know, if something's happening, you got two days to put it together, not, you know. If you're lucky. If you're lucky and you have, but the point is that it's the pacing of everything. It's the fact that you have to, if you're going to be successful on Wall Street, especially in the sell side, you have to be...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Sort of There's some of that, but I think that the. The big difference, I mean, obviously the Fed is making decisions that have to be made quickly and aggressively. And so, and I think that sense there, and that's why you need to have a reasonably strong chairman. There are times in which you really have to move.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“The chairman is obviously the most important member of the committee, and it's important to have a strong person who can gather consensus together, but you don't want to have a decision-making process where there's a complete control by one individual.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, and I think if you look at the when Greenspan first came in, he faced a pretty fractious committee. And I think over time as his reputation built and he kind of took command of the committee, you probably had things go too far in the other direction with the chairman kind of. Too much. And I think one of the things that Bernanke did when he came in is he deliberately, I think, came in to reduce the cult of personality around the chairman. I mean, remember that when Bernanke retired, he did not go to Jackson Hole for his last meeting there because Bernanke didn't want the kind of sending off on a carpet kind of approach. He wanted to”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that the good thing about the Fed, I think, and the way the policy process works is that it's a respectful group, right? The chairman doesn't totally dominate the committee, but there's a sense of respect and coordination among them. So even with dissents and disagreements and all that, you end up with a sensibly debated conclusion. I mean, the advantage of having a committee decision making is that committees make fewer mistakes than individuals. In this case, the committee may be a little bigger than it would be optimally if you look at models of optimal sized committees, but having a committee is helpful because it avoids Somebody who kind of just gets off in the wrong track and doesn't listen to enough voices.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, the Fed is a really almost bizarre structure because remember it was created way back at the beginning of the last century, 100 years ago, and it was designed to have checks and balances in the sense of not putting all the power in Washington. In spreading out these presidents across the country. So there's almost a deliberate decentralization. I think that the system works okay. I think that you get very different views. You have some of these reserve banks or the presidents of traditionally a hawk and very anti-inflation. The obvious one would be the Kansas City Fed where we've had a string of very hawkish presidents. And then you have others who are very dovish. The Boston Fed president has been on the dovish side. Charlie Evans at Chicago on the Dovish side. And so I think that that's a healthy debate.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Is it a deep out of the money emergency? Negative, and that is a problem, right? That's a problem if you, and I think that central bankers debate this all the time about when do you step in, when do you react to the markets? And the answer is that put needs to be priced pretty out of the money so that people don't get the sense that the central bank's always going to rescue them. And that was the, so having too generous a put, I think you could argue at times that was one of the problems Greenspan had.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“No, I'm saying that it's kind of a job where if you don't want to at any time kind of be viewed as a cheerleader to the markets. And I think that he ended up sounding like that. I don't think he was intentional. I think that he ended up sounding like that.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Mortgage rates by the mortgage mark, a very generous mortgage market, and a lot of rational exuberance. So that idea that somehow we could kind of work our way through this without any kind of problem for the Fed chairman to say that I didn't think was right.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“No, well, and that was the problem is that we knew at the time already that the credit availability had overextended. So these markets were all joined together by...”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I can point back to pieces I wrote at the time where I said, listen, you know, it's not true. Greenspan gave a speech where he said that real estate markets are inherently local. They're determined by local conditions. And it was an argument around there being froth and that remembers froth speech. Yes, yes, very much. Frost speech in the housing market. But the argument he was trying to make was that they won't all go up and down together. So they're not that risky, right? Because they'll move in separate directions.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Because they took all the shock out of it. The bond market rallied, the equity market rallied. You had a massive expansion in cheap credit in the housing market. And so the mistake he made, I thought, in real time, in hindsight, I thought obviously the mistake looks much bigger. But in real time, I thought, why are you being so gentle here? Is there a law against raising interest rates 50 basis points? And the other thing that I didn't like about him in real time, again, I don't want to be 2020 because I think that would I have made similar mistakes. I didn't like the way he talked about the housing market at that time. He was a cheerleader for the housing market. He should not have been doing that. He gave speeches that suggested that risks to housing are very low.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“And the housing. And I think so, what I felt, so I to be, you know, I think to be honest about it, I have to talk about what I wrote in real time because 2020 hindsight is a little bit unfair. So what I wrote in real time was I didn't understand why he felt so obliged to raise rates so carefully, you know, the gradualist approach. Because what happened, as you said, they lowered rates to very low levels. And then they took such a long time to get them back to normal. They didn't create any financial restraint. It was like they weren't even hiking.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Financial markets TV. And so the exaggerated description of his powers of forecasting and all that was way overdone. And what happened lay in his career is he made some mistakes. Such as.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. Well, this was before the crisis had really played out. So at the time, your valuation of Greenspan would have been less negative. But what I found striking is that the problem that what happened with Greenspan is that, and this is partly because of the development, frankly, of business television, was that this cult of personality developed around chairman. And he became the face of business.”
2016-02-05 · Masters in Business · Interview With Ethan Harris: Masters in Business (Audio) · IDENTIFIED FROM THE TRANSCRIPT · source